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Exam 21: A Statement of Cash Flows

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Question 31

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On its statement of cash flows, what amount should Howard show for its net sales adjusted to a cash basis (i.e., cash received from sales) ?

A) $616,000
B) $623,000
C) $625,000
D) $595,000

E) A) and D)
F) A) and C)

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Question 32

Multiple Choice

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During the year the balance in the Accounts Receivable account increased by $6,000.In order to adjust the company's net income to a cash basis using the direct method on the statement of cash flows, it would be necessary to:

A) subtract the $6,000 from the sales revenue reported on the income statement.
B) add the $6,000 to the sales revenue reported on the income statement.
C) subtract the $6,000 from the cost of goods sold reported on the income statement.
D) add the $6,000 to the cost of goods sold reported on the income statement.

E) All of the above
F) B) and C)

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Question 33

Multiple Choice

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Using the direct method, sales adjusted to a cash basis would be:

On the statement of cash flows, the cost of goods sold adjusted to a cash basis would be:

Last year Anderson Corporation reported a cost of goods sold of $100,000.The company's inventory at the beginning of the year was $11,000, and its inventory at the end of the year was $19,000.The prepaid expense account increased by $2,000 between the beginning and end of the year, and the accounts payable account decreased by $4,000.Cost of goods sold adjusted to the cash basis under the direct method would be:

On the statement of cash flows, the sales adjusted to a cash basis would be:

The net cash provided by (used in) financing activities would be:

The net cash provided by (used in) financing activities for the year was:

On the statement of cash flows, the selling and administrative expense adjusted to a cash basis would be:

Freeport Corporation's income statement for last year appears below: The beginning and ending balances for last year are available for the following selected accounts (the company did not dispose of any property, plant, and equipment during the year): Required: Using the direct method, prepare in good form the operating activities section of the statement of cash flows.

Reven Corporation prepares its statement of cash flows using the direct method.Last year, Reven reported Income Tax Expense of $25,000.At the beginning of last year, Reven had a $5,000 balance in the Income Taxes Payable account.At the end of last year, Reven had a $9,000 balance in the account.On its statement of cash flows for last year, what amount should Reven have shown for its Income Tax Expense adjusted to a cash basis (i.e., income taxes paid) ?

The selling and administrative expense adjusted to a cash basis would be:

The net cash provided by (used in) investing activities for the year was:

The net cash provided by (used in) financing activities for the year was:

Crossland Corporation reported sales on its income statement of $435,000.On the statement of cash flows, which used the direct method, sales adjusted to a cash basis were $455,000.Crossland Corporation reported the following account balances on its balance sheet for the year: Based on this information, the beginning balance in accounts receivable was:

Harkey Corporation's balance sheet and income statement appear below: Cash dividends were $29.The company sold equipment for $15 that was originally purchased for $6 and that had accumulated depreciation of $2. Required: Using the direct method, determine the net cash provided by (used in)operating activities.